The week-long strike over the use of foreign labour at the Lindsey oil refinery in Lincolnshire ended today after workers voted to accept a deal, negotiated between unions and management, that will see an additional 102 jobs offered to British workers on the site.

But the strikers, who will return to work on Monday, promised they would take their fight to other refineries employing foreign labour, starting with Staythorpe, in Newark.

As part of the deal the employment minister, Pat MacFadden, has also reached an agreement with the engineering construction industry association to ensure non-UK contractors "will always explore and consider the local skills availability and to consider any applications that may be forthcoming".

Speaking in the Commons, Gordon Brown insisted ministers were eager to work with the European commission to counter recent European court judgments if they undermined the right of unions to strike against foreign labour undercutting wages.

The agreement, hammered out in talks late on Tuesday night, was formally put to the 695 strikers in a vote this morning.

Around 300 workers packed into a marquee at the North Killingholme site to vote on the proposals, and loud cheers could be heard coming from the behind-closed-doors meeting.

Phil Whitehurst, a member of the negotiating committee for the GMB union, said the result had been unanimous.

"It was an excellent decision," he said. "We have now got the chance to go back to work, but the fight does not stop here.

"The fight continues at Staythorpe and anywhere else where an injustice is being done. It was a unanimous decision. It was an excellent vote.

"We have got the MPs worried. I think we have got Gordon Brown worried. I don't think they know how to deal with us. We are not trying to bring the government down, we're just trying to get them to listen."

The wildcat strike, supported by a wave of unofficial solidarity action at energy and construction plants around the country, began after the Unite union claimed that the Italian firm IREM, a subcontractor at the Lindsey plant, had exclusively hired Italian labour – a practice the union said was spreading across the construction sector.

The government and the site owner, Total, insisted the Italian workers had been hired at rates set by British national agreements, and that IREM had not broken the law in bringing over its own direct labour.

The firm had been hired after the preceding contractor was deemed to be failing to deliver on time.

Unite insisted the strike had not been directed against the Italians and, under the agreement, no Italian workers will lose their jobs.

Privately, ministers have been appalled by the anti-European rhetoric on the picket line and even among some Labour MPs. They argued that the dispute set a dangerous precedent, pointing out that 150 British workers were employed by IREM in Italy.

Overall, there are 47,000 UK workers "posted" in Europe on temporary work, compared with 15,000 foreign workers posted in the UK.

Ministers fear UK-posted workers could be driven out of jobs on the continent if European unions followed the lead of the British strikers.

The Unite general secretary, Derek Simpson, insisted his union had been neither protectionist nor xenophobic.

"The problem is not workers from other European countries working in the UK, nor is it about foreign contractors winning contracts in the UK," he said. "The problem is that employers are excluding UK workers from even applying for work on these contracts.

"The flexible labour market is a one-way street that only benefits the employers. We have seen the backlash as the recession bites.

"The government must act to level the playing field for UK workers. No European worker should be barred from applying for a British job and absolutely no British worker should be barred from applying for a British job."

The newly agreed deal gives British workers 102 jobs out of a total of 195 on the bulk of the new desulphurisation plant contract, including 67 skilled positions – welders, electricians and platers. It is not clear why new jobs have become available.

The Unite chief negotiator, Bernard McAuley, said: "We've made sure that no Italians have been made redundant, we've got jobs for 102 British people and we've also made sure that Fabio Capello stays as England manager. We want integration now, not segregation."

Brown was again forced to defend his phrase "British jobs for British workers" in the Commons after David Cameron, at prime minister's questions, accused him of a lack of judgment and pandering to protectionists' fears.

The prime minister countered: "Can anybody here say that they do not want British workers to get jobs in our country?"